Category Archives: Medicare +Updates

The federal government has cut payments to 769 hospitals with high rates of patient injuries, for the first time counting the spread of antibiotic-resistant germs in assessing penalties.

The punishments come in the third year of Medicare penalties for hospitals with patients most frequently suffering from potentially avoidable complications, including various types of infections, blood clots, bed sores and falls.

This year – 2016 – the government also examined the prevalence of two types of bacteria resistant to drugs.

Based on rates of all these complications, the hospitals identified by federal officials this week will lose 1 percent of all Medicare payments for a year — with that time frame beginning this past October. While the government did not release the dollar amount of the penalties, they will exceed a million dollars for many larger hospitals. In total, hospitals will lose about $430 million, 18 percent more than they lost last year, according to an estimate from the Association of American Medical Colleges.

The reductions apply not only to patient stays but also will reduce the amount of money hospitals get to teach medical residents and care for low-income people.

Forty percent of the hospitals penalized this year – 2016 – escaped punishment in the first two years of the program, a Kaiser Health News analysis shows. Those 306 hospitals include the University of Miami Hospital in Florida, Cambridge Health Alliance in Massachusetts, the University of Michigan Health System in Ann Arbor and Mount Sinai Hospital in New York City.

Nationally, hospital-acquired conditions declined by 21 percent between 2010 and 2015, according to the federal Agency for Healthcare Research and Quality, or AHRQ. The biggest reductions were for bad reactions to medicines, catheter infections and post-surgical blood clots.

Still, hospital harm remains a threat. AHRQ estimates there were 3.8 million hospital injuries last year, which translates to 115 injuries during every 1,000 patient hospital stays during that period.

Each year, at least 2 million people become infected with bacteria that are resistant to antibiotics, including nearly a quarter million cases in hospitals. The Centers for Disease Control and Prevention estimates 23,000 people die from them.

Infection experts fear that soon patients may face new strains of germs that are resistant to all existing antibiotics. Between 20 and 50 percent of all antibiotics prescribed in hospitals are either not needed or inappropriate, studies have found. Their proliferation — inside the hospital, in doctor’s prescriptions and in farm animals sold for food — have hastened new strains of bacteria that are resistant to many drugs.

One resistant bacteria that Medicare included into its formula for determining financial penalties for hospitals is methicillin-resistant Staphylococcus aureus, or MRSA, which can cause pneumonia and bloodstream and skin infections. MRSA is prevalent outside of hospitals and sometimes people with it show no signs of disease. But these people can bring the germ into a hospital, where it can be spread by health care providers and be especially dangerous for older or sick patients whose immune system cannot fight the infection.

Hospitals have had some success in reducing MRSA infections, which dropped by 13 percent between 2011 and 2014, according to the CDC. AHRQ estimates there were 6,300 cases in hospitals last year.

The second bacteria measured for the penalties is Clostridium difficile, known as C. diff, It can be spread through contaminated surfaces or hands. ………,

C. diff has challenged infection control efforts. While hospital infections dropped 8 percent from 2008 to 2014, there was a “significant increase” in C. diff that final year, the CDC says. AHRQ estimated there were 100,000 hospital cases last year.

“The reality is we don’t know how to prevent all these infections,” said Dr. Louise Dembry, a professor at the Yale School of Medicine and president of the Society for Healthcare Epidemiology of America.

The Hospital-Acquired Condition Reduction Program also factors in rates of infections from hysterectomies, colon surgeries, urinary tract catheters and central line tubes. Those infections carry the most weight in determining penalties, but the formula also takes into account the frequency of bed sores, hip fractures, blood clots and four other complications.

Specialized hospitals, such as those that treat psychiatric patients, veterans and children, are exempted from the penalties, as are hospitals with the “critical access” designation for being the only provider in an area. Of the remaining hospitals, the Affordable Care Act requires that Medicare penalize the 25 percent that perform the worst on these measures, even if they have reduced infection rates from previous years.

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While many sepsis cases are due to unknown organisms and broad spectrum antibiotic selection is appropriate, Centers for Medicare and Medicaid Services (CMS) is releasing an update to the Severe Sepsis and Septic Shock: Management Bundlemeasure to allow for organism specific antibiotic administration when there is clinician documentation that indicates the causative organism and susceptibility are known.

In an emergency, you should go to the nearest hospital. When you can plan ahead, discuss the information you find here with your health care provider to decide which hospital will best meet your health care needs.

Medicare proposed a new pricing plan for drugs administered in physician offices and hospital outpatient departments that would reduce an economic incentive to order a higher-priced drug when a less expensive one might work just as well, or better.

That incentive exists now because the Medicare Part B program pays providers the average sales price (ASP) of the drug, plus an extra 6% to cover handling and administration. That 6% margin translates into higher revenue as the price of a drug increases.

Under the proposed reimbursement model, Medicare Part B would pay the ASP, an add-on of only 2.5%, and a flat fee of $16.80 per drug per day, regardless of its price.

In a news conference today, a senior official in the Centers for Medicare and Medicaid Services(CMS) said that the new arrangement will prove liberating for many oncologists, who routinely administer chemotherapy drugs in their offices.

“We’ve heard from oncologists who feel pressure from their health systems to pick higher cost drugs when they’re not appropriate for their patients,” said Patrick Conway, MD, the chief medical officer at CMS and its deputy administrator for innovation and quality.

A report issued today by the Department of Health and Human Services (HHS) underscored the need to curb spending on Part B Medicare drugs.

The national tab for prescription drugs was $457 billion in 2015, or 16.7% of spending for all personal healthcare services, according to a report from the HHS Office of the Assistant Secretary for Planning and Evaluation. Of that amount, $128 billion, or 28.1%, went for non-retail drugs, which include chemotherapy, injectables, and eye care treatments administered in an outpatient setting.

The report puts the cumulative annual growth of prescription drug spending from 2013 to 2018 at 7.3% on average compared with an annual 5.2% increase in spending on all personal healthcare services. Price increases and a shift to prescribing more costly drugs in general account for about 30% of the overall growth of prescription spending, according to the HHS report.

Five-Year Study

CMS intends to introduce its new reimbursement framework for Part B drugs in select geographic regions late this year. In 2017, CMS will broaden its experiment by adding various pricing strategies now used in the private sector. These include discounting or eliminating patient cost-sharing, giving clinicians feedback on their prescribing decisions, and basing a drug’s price on its clinical effectiveness in treating different indications. CMS will compare the new model with the status quo in other geographic areas for 5 years.

The full proposal for reimbursement of Medicare Part B drugs was filed today on the Federal Register. CMS will accept comments on its proposal through May 9.The Federal Register document contains instructions on how to submit comments to CMS.

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